Remember a little over a year ago, when I started to look into buying a new condo closer to work? And how I was blown away by how much people were asking for their units relative to what they have paid for them only a year before? I recall showing UncleSam and Kipsy one particular unit, in a building that had just converted from rental to condos, where the owners were asking for $600,000 when one year before, they had bought for $450,000. It's across the street from my work, and I really had my eye on that place. I thought to myself, "Surely they'd accept what they paid for it, just to get out from under it in a housing market that everyone can see is about to go down a little bit."
I called the real estate agent with the listing, told her I'd be willing to pay no more than $450,000, and she basically laughed and told me not to bother. I did go ahead and go take a look during an open house. It was a perfectly nice place, but far from luxury. I ratcheted down my price point, figuring the flippers who bought these conversions were going to lose their shirts, and that I'd pay no more than $400,000 for a 3/2, with parking included.
I've been watching the building. Most of the owners have simply pulled their listings off and are renting the units at a loss, while they slowly bleed equity in an insane hope that the market will turn around. It's impossible for me to feel sorry for them. The units that are still for sale are mostly developer's units, and have just been sitting there for a year. It's bloody. I thank my lucky stars that that agent told me not to bother--what if the seller had accepted an offer? Today, I think it's too expensive even at $400,000. I'm now thinking if it drops closer to $300,000, I might--might!--make a move.
This economy is really scaring me.
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This blog is in my Bookmarks and I can read other people's blogs, but don't know how to create my own so for now I will be an add-on.
ReplyDeleteI am forever grateful that I got out of my too-big house when I did, and the value of the condo I am in has increased with rapid turnovers. This makes it a good investment for Uncle Ben.
Kipsy, Charles and I celebrated Christmas on the 24th so yesterday I went to a movie and dinner at Denny's with my friend Beverly and a recently widowed fellow from church. We saw Doubt which I highly recommend. Meryl Streep will probably get an Oscar for her performance (if the voters will forgive her for Mamma Mia).
Charles and I talked with the gang at Chip's including Uncle Sam. Apparently Chip is able to manage at least until April when she might have to sell the house. Dean sure is a prick.
Roothy, how was your day?
You mean Kipsy, WALLY and you! You're the second person who has recommended Doubt to me. Maybe I'll go see it today. (and I LOVED Mama Mia!)
ReplyDeleteMake sure you "log in." Then, you should be able to post.
My Christmas was actually just spent editing a paper. Kind of a drag. But at least I got a lot done!
It really just boils down to greed on the part of developers and over expectations on the part of home buyers. We had a developer kick a bunch of renters out of their apartments a few years ago in hopes of building and selling some "luxury" condos on top of comercial space a few blocks from my house in EPA. The condos first sold for @$700,000 and found about 5 suckers/buyers the rest went to auction 6 months ago for 3 - 400,000. They didn't even sell all of them at that price but are not dropping the price, they're just offering various incentives. Both the developers and the first buyers have basically lost their shirts and I agree, I don't feel sorry for any of them.
ReplyDeleteI am actually looking at the economy as correcting the past 20 or so years and not tanking.